SMM Evening Comments (Nov 5): Shanghai nonferrous metals closed mostly higher as the result of the US election is still up in the air

SHANGHAI, Nov 5 (SMM) – SHFE nonferrous metals, except for copper and nickel, ended higher on Thursday November 5, as investors are keeping a watchful eye on the US presidential election.  

Aluminium added 0.44%, zinc inched up 0.05%, lead advanced 0.8% and tin rose 0.43%, while copper fell 0.52% and nickel weakened 0.15%.

SMM data showed that aluminium billet stocks across the five major consumption areas — Foshan, Wuxi, Huzhou, Changzhou and Nanchang — in China built up 4,400 mt from a week ago to 94,500 mt as of Thursday November 5.

Social inventories of primary aluminium ingots across eight consumption areas in China, including SHFE warrants, decreased 34,000 mt from last Thursday to 654,000 mt as of November 5.

Copper: The most-traded SHFE 2012 copper contract fluctuated along the daily moving average of 51,530 yuan/mt today, and ended 0.52% lower at 51,420 yuan/mt, with trading volume shrinking significantly by 26,000 lots to 96,000 lots. Investors are still keeping a close watch on the US presidential election today, with the race between President Donald Trump and Democratic nominee Joe Biden still up in the air. In China, trading of new houses in 40 cities fell 3% on the month, and fourth-quarter orders at State Grid did not increase amid tepid downstream consumption, which pressured copper prices to some extent. US claims for unemployment benefits deserves attention tonight.

Aluminium: The most-traded SHFE 2012 aluminium contract finished the day 0.44% higher at 14,850 yuan/mt, with trading volume declining 48,763 lots to 87,249 lots. Macro uncertainties exacerbated volatility, and the contract is likely to fluctuate at highs in the short term.  

Zinc: The most-liquid SHFE 2012 zinc contract rose to its highest since early September at 20,165 yuan/mt today, before giving up some gains to close just 0.05% higher on the day at 19,845 yuan/mt. It is likely to move around the five- and ten-day moving averages tonight.

Nickel: The most-traded SHFE 2102 nickel contract ended the day 0.15% lower at 116,380 yuan/mt, after hitting an intraday low of 115,500 yuan/mt earlier in the session. As the US presidential election is still not off the table at this point, investors are cautious.  

Lead: The most-active SHFE 2012 lead contract moved along with the daily moving average in the morning, but climbed rapidly to an intraday high of 14,495 yuan/mt in the afternoon before relinquishing some gains to close 0.8% higher on the day at 14,425 yuan/mt. The US Federal Reserve will unveil new monetary policies tonight.